good morning. your money, your vote. donald trump and hillary clinton square off in a second presidential debate. we'll bring you the highlights straight ahead. no deal for deutsche bank as shares are under pressure as investors want word of a doj settlement. and samsung us is spends production of the note 7 as they deal with factory problems. it is monday, october 10, 2016. and "worldwide exchange" begins right now. good morning. welcome to "worldwide exchange"

from monday morning. >> good morning, i'm wilfred frost. we haven't sat here together in a while. >> it's good to be back. hillary clinton and donald trump's exchanges last night certainly getting personal. the candidates didn't shake hands at the beginning of the night. and then as soon as things kicked off, the candidates were asked to address the audio that surfaced on friday of donald trump making vulgar remarks. listen. >> this was locker room talk. i'm not proud of it. i apologized to my family and to the american people. certainly i'm not proud of it. >> have you ever done those things? >> i will tell you, no, i have not. >> donald trump also went after hillary clinton for her e-mail scandal. >> if i win, i am going to instruct my attorney general to get a special prosecutor to look into your situation. because there has never been so many lies, so much deception,

there has never been anything like it. and we're going to have a special prosecutor. >> it's just awfully good that someone with the temperament of donald trump is not in charge of the law in our country. >> because you would be in jail. >> among the markets moving on the political story, of course we watched the mexican peso. >> no more so than me. >> but it has become the test of the market reaction to a trump presidency. that drop you see overnight, that is the dollar falling against the mexican peso. the mexican peso strong at the one-month high after all the weekend news flow. we'll talk a lot more about the highlights from last night's debate in a moment and some of the biggest takeaways, including some talk on the economy. very little. >> a little bit of policy in there. but it was acrimonious.

first, a quick market round-up of what is going on around the world in terms of trade. futures at this hour are called higher by about 54 points for the dow. the s&p by 6 or 7. the nasdaq by 14 points. it was the first negative week in four last week for the markets. we are around half a percent depending on the numbers you're looking at. the worst performer down 5%. banks, the only positive performer. in fact, doing surprisingly well. goldman sachs was up 5% last week responding well to the ticker in yields. let's look at the yields. because a clear move. we were 1.5% on the ten-year note, about ten days ago to two weeks ago. we were above 1.723. the banks really getting a good performance last week based out of the earnings out of this week. caution trades in the early trade in europe. we'll show you what is happening with stocks over there. two factors weighing on stocks. you have deutsche bank shares

down sharply 3% in europe. and also oil prices are down. that is weighing on the overall indices. we are coming off two down weeks for european stocks. so still fractional declines. heavier losses in places like italy and spain than say germany. we'll keep an eye on that. the ftse, 100 remains a strong performer on the back of yet another day of weakness for the british pound. in asia markets in hong kong and japan are closed today. china reopened after a week-long holiday. stocks rising by the most in two months today. the property sectors dropped at aiming cooling surging home prices. the new survey shows the chinese sector created jobs in september at the fastest place in seven months. there's a mover overnight. the chinese currency yuan is sinking. the chinese setting it at a six-year low against the dollar today. it did rebound a little in the session.

the explanation from traders on this is we came off a week-long period of where the markets were closed there and a period where the dollar strengthened the early against many other currencies including the british pound that was crushed. we'll talk about that as your money getting cheaper by the day. >> it does, indeed. i need to travel to europe. >> the chinese currency decline is being attributed to the strength of the dollar. >> yeah, i think people aren't too concerned about the move. a week of no trading and the dollar was up over a percent. so there's some reason to play cat catch-up. oil prices are soft this morning, 49.45. we have had a good couple weeks on opec since the algeria meeting. another meeting going on today. we'll go out to steve sedgwick out there talking to the bp ceo bob dudley. there's still more stability

here than the back end of last week. nonetheless, 124. unbelievable levels for cable when you consider where it has been recently. we are at 31-year lows in and around them. gold prices, let's have a look quickly at gold in light of recent moves in the dollar. it's up a percent today, 1264. now to today's top story, last night's presidential debate. our john harwood was inside the hall for the firsthand view of last night's debate joining us from st. louis. yes, john, we want to hear about the debate but also the crazy weekend that was in politics. >> reporter: well, that crazy weekend produced the debate we saw. donald trump had a crisis weekend. the release of that tape from his time with billy bush at "access hollywood" had sent much of the republican party abandoning him over the weekend. and what donald trump did was respond in ways that reflected the deep tribal feelings between

democrats and republicans in this party. trying to arouse the fighting instinct among republicans to rally around him by targeting hillary clinton. and so every time hillary clinton pointed either to the tape or to other things that donald trump has done during the campaign that offend her supporters, he went back very hard at hillary clinton and bill clinton. of course, he appeared before the debate with women who had accused bill clinton of sexual wrongdoing, juanita broderick and paula jones. take a look at the debate when hillary clinton started out by pointing to what we can learn from donald trump from that tape and how he came back to talk about bill clinton. >> what we all saw and heard on friday was donald talking about women, what he thinks about women, what he does to women,

and he has said that the video doesn't represent who he is. but i think it's clear to anyone who heard it that it represents exactly who he is. >> if you look at bill clinton, far worse, mine are words, and his are action. what he's done has never been done in the history of politics in this nation so abusive to women. >> reporter: now we had the same thing play out on the issue, in less personal terms, on taxes. hillary clinton making familiar democratic arguments about how she was going to raise more taxes from the wealthy to fund the programs, spending programs that she wants to implement. and donald trump trying to tell middle class voters, she says she's not going to raise your taxes, she's going to raise rich people's taxes, but she's really coming after you. take a look at this. >> we are cutting taxes for the middle class, and i will tell

you, we are cutting them big league for the middle class. i'm telling you, hillary clinton is raising taxes. you can look at me, she's raising your taxes really high. and what that's going to do is a disaster for the country. >> people like donald who pay zero in taxes, zero for our vets, zero for our military, zero for health and education, that is wrong. and we're going to make sure that nobody, no corporation and no individual can get away without paying his fair share. >> reporter: now what exactly happened in that debate was that each candidate was giving the base of their party, the core supporters, a strong reason to rally behind them. the problem for donald trump is that her base is a lot bigger than his base. we've got a new survey monkey poll out this morning showing her ahead by five nationally. that's nbc news and survey

monkey tracking poll. up five points is a lot in presidential politics and doesn't take into account the impact of the republican defections over the weekend. so nothing happened last night that changed the trajectory of the race. and the trajectory of the race is one that points in the favor of hillary clinton. >> although some are wondering, john, after last night, another sort of threat and storyline to emerge is what does mike pence do. there was discussion over syria and russia from donald trump where he seemed to disagree completely and dismiss what his running mate said in the vice presidential debate, not to mention the fact that pence pulled out of some events over the weekend after that tape was released. what do you make of that relationship and where it goes from here? >> reporter: well, that was a reflection of some problems that still exist and may get bigger because of that remark over foreign policy. and in a normal debate, they didn't have that intensely

personal air to it, that would have been the most prominent moment in news coverage. mike pence last week in the debate made a forceful argument trying to bypass what donald trump had said about vladimir putin in russia and said, no, it's still the republican position that we are strong against russia, that we want to smack russia for what they're doing in syria. donald trump came out on that same last night and said, i disagree with mike pence. i disagree with my running mate. remember, mike pence was already reeling from the disclosures on the tape. he's a conservative christian, very devout. he didn't like what he heard on that tape. he canceled his appearance at the wisconsin rally that donald trump had been disinvited to. now, i talked to a pence advisor last night who said there's no chance that mike pence will leave the republican ticket. some of his advisors urged him to do that. but that was a back of the hand

from the top of the ticket to the number two on the ticket. and the thing was, it was a back of a hand that went right at what many republicans liked about mike pence. this is not going to endear donald trump to the republican foreign policy mainstream. >> john, when we see a performance like mr. trump that is similar to what he did in the primaries, and by that i mean doubling down significantly as opposed to backtracking on certain topics, if that does endear him to his supporters, does it do him some gain? or last night's performance, at least relative to expectations, as he outright gained new number last night. >> reporter: no, he will not gain votes from this. that is a performance that i think to all the people during the bill clinton era thought if the republicans had just gone harder at bill clinton, if they had just convicted him in the senate of the impeachment charges from the house, if they

had been more negative. that would have profited the republican party more. but that was tried and it didn't work. in fact, it backlashed on republicans at that time. backfired is what i meant to say. republicans did not get the result in 1998 in those midterm elections that they wanted. and what has happened is, the core people who believe that are the core people who are advising donald trump right now. so all the people who think the answer to republican problems is to go harder and harsher at democrats and specifically hillary clinton, that's what is driving the trump train. but if you're a college-educated woman who is the key swing vote in the election, you did not get a reason for donald trump or from donald trump to vote for him last night. and hillary clinton went aggressively after those voters. >> john, just 30 seconds left. in the significance of the establishment republicans dropping out over the weekend, dropping their support of donald

trump, is there any, as long as the money from the rnc keeps flowing to the campaign? >> reporter: yes, the rnc money flowing to the campaign doesn't make much difference. money won't decide the race. both candidates have the ability to reach supporters, but the defections from the republican politicians, and there have been a lot over the weekend and there were a lot before that, top cabinet members from previous republican administrations, et cetera, all of those are signals and cues to those college-educated women, in particular, many college-educated men, donald trump is doing poorly among both groups relative to past republican nominee. those are a signal to those waivering to say, no, this guy isn't a regular republican. this guy isn't the kind of republican you voted for in the past. he's different. and that is why his numbers have been poor and they are not likely to get better from here. >> okay, john, thank you for joining us this morning. much appreciated, john harwood with all the latest on the

debate. moving on to the aftermath of hurricane matthew, it battered the southeastern u.s., but the devastation is overwhelming. at least 19 people in the u.s. are dead as a result of the storm. more than 2 million businesses and homes are still without power across the southeastern seaboard. they estimate that the economic cost of hurricane matthew will be at least $4 to $6 billion. there's no economic data today, but plenty of action for the rest of the week. so the bond market reminder is closed today for the columbus day holiday. on wednesday we'll get minutes from last week's fed meeting. and we'll look at the september input prices. and on friday input sales. the october consumer sentiment is also out that day. earnings season is finally upon us. several names are reporting this week starting with the unofficial kickoff. alcoa tomorrow, csx posts numbers on wednesday. then results from the three big

banks on friday. citigroup, jpmorgan and wells fargo. that's a busy one for you. >> certainly, not just the numbers but the calls. i want the ceos to be grilled on them. >> like the european banking system -- >> wells fargo is reporting itself on friday. lots to focus on later in the week for banks. meanwhile, samsauung's phon recall crisis is getting worse as they have halted production of the new note 7 as the replacement models have caught fire. at&t and t-mobile stopped exchanging after one device forced the evacuation of a southwest airlines flight last week. in a statement samsung will only say it's adjusting shipments of the galaxy note 7 to ensure quality. shares up 1.5% recently. they have had a tough time, although a decent rebound over the last week or so. >> the stock is at an all-time high up 1% on this news, which is surprising a lot of people given the sort of trust that was

broken here. >> and, at the same time, apple's launch of the new phone is doing pretty well. >> good timing on that. elon musk is teasing a new product for tesla. they will announce this product on october 17th. it will be unexpected by most. tesla previously announced plans to unveil a solar roof on october 28th jointly produced by solar panel maker solar city. musk says that unveiling is on schedule. he's dismissing speculation that the companies will need to raise added capital in the fourth quarter saying, quote, it won't be necessary for either. investors certainly have the questions and doubts. the shares have underperformed. shares of deutsche bank falling today after the ceo failed to secure a deal with the department of justice over the weekend. he attended the imf and world bank meeting in washington raising hopes that he might personally negotiate a settlement. the doj wants a $14 billion fine

on the company. the timing was that it may happen this weekend. >> he went back to germany with no deal? >> i don't know exactly where he is right now. but i think a week ago people were hoping it would have already happened. and i'm thinking we're still looking at a week or so, a couple weeks away. they need to get the deal. up 2.5% today. not groundbreaking yet. oil prices are under pressure ahead of an oil meeting in istanbul. we'll take you live there to the conference with some important commentary and interviews. you're watching "worldwide exchange" on cnbc. this woman owns this house,

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oil prices are under pressure this morning. wti goes below $50 a barrel at 49.53. off a little more than .50%. some of the nonmore opec producers are agreeing to cut their output. steve sedgwick is in istanbul speaking to a lot of important people there and joins us now with more. good morning, steve. >> reporter: yeah, very good morning to you. a lot of people are very concerned about what a cut from opec may mean. some really liked it including the people here at the world energy congress, which literally has thousands of oil men and women discussing the price. we heard from khalid faleel, the oil minister, the hopes are for

a conclusive deal. back in see yen vienna we'll he what he wants to do in terms of scaring the horses. >> opec wants to make sure we don't crimp too tightly. the prices have dropped too low to impact investment. many companies are hurting, many countries are hurting. that needs to be relieved. but at the same time we don't want to get or give the market an opposite signal and shock markets into prices that could be harmful. >> reporter: of course opec wants to price up. anyone that remembers 2008, i do, i remember the big opec cuts and the volatility from the price of $47 down to $40. they don't want to see that kind of volatility. what does the market think and what do the big oil men think? bob dudley, the big ceo of bp,

here's what he thought came out of that meeting. >> i didn't know what to expect coming out of algiers. ly note that countries that traditionally don't have good relations actually made some understandings and some agreements there. and i think what is less important, what are all the details of that agreement, is just the fact that people are talking and the cooperation is very significant. they will continue to talk, i think, here in istanbul and we'll see what happens in november. >> reporter: what bob dudley was saying there is that the talk that is happened in algiers hopefully will carry on to november 30th for those of you watching the oil market. can they get people to carry on talking? what bob was saying is traditionally the likes of the iranians and the iraqis have found it hard to get a deal with saudi, maybe that means we'll get a better deal back in november. back to you guys. >> steve, thank you for that live from istanbul. oil prices are soft after a decent ten days or so.

still to come, this morning's top stories including social media reaction to last night's presidential debate. stay tuned, you're watching cnbc, first in business worldwide.

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the s&p up 8. nasdaq up 17 after the presidential debate. after stocks are coming off a losing week, the first time that has happened in the last four. action in the currency market as well. we are coming off a week where the dollar strengthened a lot, especially against the yen. that is continues this morning. it's also stronger against the euro by a quarter of a percent. the british pound continues to weaken. 124.15. and the peso is at a one-month high. diminished prospects perhaps that donald trump will win the presidency has helped the peso recover some of its losses over the last 24 hours. quickly, oil is under pressure as well. and that is hurting some of the european stocks in early action. wti just below $50 a barrel. 49.56. great stuff, sara. still to come, the morning's top stories including highlights from last night's presidential debate. don't go anywhere, you're watching "worldwide exchange" on cnbc. all the networks are great now.

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and donald trump and hillary clinton get personal. and an audience member has become an internet sensation. and new this morning, sap samsung us is spends p-- suspens

production of the new galaxy note. good morning. welcome back to "worldwide exchange" on cnbc. i'm sara eisen. >> and i'm wilfred frost. a very good morning from me as well. >> we'll look at u.s. stocks in the early action here after the first down week in four last week. dow futures are up 65. there's really nothing in the way of economic data or earnings. a lot of that kicks off starting tomorrow. it's also light trading with columbus day, which has kept the bond market closed today. s&p futures are up a little more than eight points. and nasdaq futures are up nearly 18. the early action in europe not faring quite as well. financials are under pressure. deutsche bank shares are back in decline mode on no word of any deal with the doj in terms of a settlement. though things have just started to look a little bit better with the dax flipping positive in the last few moments or so. same with the french and the uk indices. italy and spain notably weaker.

as for asia overnight, some of the major indices were closed. though shanghai opened after a week-long holiday with a lot of strength. the shanghai closing higher 1.5%. australia open with minor gains. japan was closed. the chinese currency was set to the weakest level since back in september 2010. a lot of people talking about that overnight. not too worried about it as they attribute it to the dollar strength we saw last week. >> yeah, it's not something people are panicking about in asia. we'll look at oil prices a little soft this morning after what has been a very strong last week or ten days. 49.60 down a third of a percent. the ten-year note has seen significant ticks up in yield over the last ten days or so, 1.72. it's closed today, the bond market, for columbus day. but a good indication of where we are moved the last week or so. that's a big factor why the banks were the best performing

sector in positive territory last week. goldman sachs was up 5%. let's have a look at the dollar, that's been very much in focus over the last week. it was stronger last week to the tune of 1% across the major currencies. but big moves against the likes of the pound, which is soft again at 124.13. as you can see, the dollar is stronger against both the yen and the euro. gold prices are a little stronger this morning, about 1% higher earlier in trade. indeed near 1263. and to last night's presidential debate, tracie potts brings us the highlights. >> reporter: both sides spinning victory after a debate that immediately dealt with the videotape. donald trump more than a decade ago saying he kissed and groped women against their will. >> you bragged that you sexually assaulted women. do you understand that? >> no, i didn't say that at all. i will tell you, no, i have not. >> based on four women who

accused her husband of sexual misconduct, hillary clinton dealt with that. >> it represents exactly who he is. >> reporter: and her deleted e-mails. >> there is no evidence that anyone can point to at all. anyone who says otherwise has no basis that any classified material ended up in the wrong hands. >> reporter: each accusing the other of lies. >> it's just awfully good that someone with the temperament of donald trump is not in charge of the law in our country. >> because you would be in jail. >> reporter: the debate did make news. trump was sending the message for not paying taxes for a number of years and breaking apart from mike pence on syria. >> he and i have not spoken and we disagree. obamacare is a disaster. >> if we just rip it up and throw it away, we just turn it back to the insurance companies the way it used to be. >> reporter: and a soft end to a tense debate. clinton said she admirers

trump's children. he called her a fighter who never gives up. tracie potts, nbc news, washington. >> tracie, thank you. investor were listening closely to what the candidates had to say. we have the policy analyst at the american enterprise institute here with us and a cnbc contributor. jamie, did you get anything new from either candidate? >> this was not a policy-heavy debate. it eventually moved away from the donald trump story and got into things like obamacare, some on taxes. but i really think the most interesting sort of economic policy thing that came out of it was really when donald trump said that, listen, if he becomes president, he's going to set the attorney general and hillary clinton. if he was president, she would already be in jail. if you're an investor in the

treasury and dollar, you view these as safehavens. and the reason these are safehavens is because of the political stability of the united states. i think that sort of political stability is needed. >> was it the most acrimonious debate you have ever seen? >> i think it's about the most acrimonious presidential debate where the candidates are not shaking hands, that's -- that first 20 minutes was brutal, talking about what trump said on tapes and trump going after bill clinton. listen, if it was up to me, we would have been talking about hillary clinton's plan for a financial transaction tax, that kind of thing. we didn't get that. and even the policy debates were fairly shallow.

i think one reason, trump doesn't have a great handle on many of his own economic plans. and the one issue where he seems to have sort of the most knowledge relatively is his trade plan, which he did talk about eventually. >> so as we eagerly await the post-weekend polls, which states will you be watching most closely? clearly everyone is watching that female demographic breakdown within the state polls. which ones are the latest toss-ups for you? >> donald trump needs to win pennsylvania. the recent polls have him down by quite a bit. he needs to win florida. i look at pennsylvania, florida, wisconsin's gotten a bit closer. listen, two weeks ago democrats were in a panic about this election. they stopped being in an panic about the middle of the first debate. and i think they are still feeling very confident after the the second debate that this is hillary clinton's to lose. she's up five to seven points. it will be interesting to see

what happens between now and election day to erase the hillary clinton lead. >> james, great stuff. thank you. now for the top trending stories that are related, last night's face-off between donald trump and hillary clinton breaking twitter records, making yesterday the most tweeted day of the 2016 election. twitter itself reporting there were more than 17 million debate-related tweets sent out. in the most re-tweeted debate coming from a professor from brooklyn college who tweeted, i am a muslim and i would like to record a crazy man threatening a woman on a stage in missouri. >> it got a lot of attention, that one. >> a lot of moments got a lot of attention within that debate. here are the top three most tweeted moments in the event. number one, trump disagreeing with his vice president, mr. pence. the issues relating to syria there. number two, trump saying he's a gentleman. and three, trump threatening hillary clinton with a jail sentence in for his

administration. >> the internet choosing its own winner of the presidential debate. kenneth bone, the undecided voter and his red sweater absolutely going viral after asking his question to the candidates. within minutes the #kennethbone was trending and a ledge was born. actor michael roserosenbaum twe this, i've been working in this business for over 20 years. kenneth bone asks a question and he's already more important than me. >> i wonder what that will do for christmas sweaters now. >> the kenneth bone red sweater. samsung's phone crisis is getting worse. they are halting production of the galaxy note 7 amid reports of the replacement models catching fire. at&t and t-mobile stopped exchanging them after smoke from one device forced the evacuation

of a southwest airlines flight last week. in a statement samsung says it is adjusting the shipments to ensure quality. and in other corporate headlines this morning, elon musk making news after the purchase of solar city and dropping new hints about a new product. landon dowdy is joining us with details on this one. >> good morning. yes, just yesterday tesla's chief executive elon musk said the company wouldn't have to raise corporate dead in q4 for acquisition of solar city contrary to the scc filing days earlier, they initiated a merger with solar city likely at a substantial expense. at the same time, tesla is ramping up the model 3 sedan, a move to need a considerable amount of cash. when asked on twitter if they would raise funds in the first quarter of 2017, tesla said they probably wouldn't either. they said they will unveil an unexpected product on the 17th

followed by the deal with solar city on the 28th. this could be a big turning point if musk aims to produce a million cars a year by the end of 2020. taking a look at the stock, shares are up more than 3% in extended trading. back over to you. landon, thank you for that. jack mar is going to hollywood. he's teaming up with steven spielberg to develop films for the chinese market. this is the first deal in china which was formally dreamworks studios. when we come back, today's must read stories. too many to choose from this morning, but first, as we head to break, check out the european early action at this hour. things have turned a little bit better. and now germany, uk and france

are all trading positively. we'll be right back with more market action on "worldwide exchange."

now to the morning's must read stories catching our attention in the papers today. in "the wall street journal," the path to president pence. it comes from a constitutional lawyer in washington and a professor of political science at harley dickinson university. they write under the 20th

amendment, the newly elected president's term begins at noon on january 20th. a president-elect trump could resign the oath of office and immediately resign. power would also fall to his vice president, mr. pence. i picked it because it gives a good little peak into some of the republican policy circles this weekend who were chattering about this idea that the tape was just too much for them. we saw a number of prominent republicans drop their support for donald trump. and behind closed doors and also on cable television, they were wondering, is there any way that he himself could drop out. that he could put mike pence up. trump pretty much cleared that up and tweeted, i'm not stepping down. he told t"the wall street journal," as much as the establishment wants me to step out, i'm not going to do it. >> and mr. pence has come out to tweet at the end of the debate, i'm proud to stand alongside mr. trump. it's been cleared up, but no doubts, rumors will persist. >> some republicans are still

dreaming about it. my pick also from the wall street journal relating to the presidential race, but a slightly different take to the main headlines of the last couple of days. in fact, it's entitled, hillary clinton loves bankers wink. the editorial where i say, when a presidential candidate says in public she wants to punish banks with more regulation, but in private says she really likes them. believe the public comments. those are the comments she'll pay for going against private promises. this goes against the other leak last week that was not just the trump video, but the wikileaks of comments she made to bankers in the speeches, which the clinton camp says they don't have time to come out to confirm if accurate. if not for the video of mr. trump, this would have gotten more attention. she's moved on. the reason i bring it up, we wonder if there's more to come of this sort that could derail

her. the last couple of weeks have been wild card releases that could maybe hurt her and fight for this gap. >> it's hard to use the argument she's different in public and private after we saw what happened this weekend. >> i agree. with all the focus on areas, it seems we have moved past it. the team is getting ready for "squawk box." kayla tausche is here. >> we are going to keep talking about the debate. it's the story of the morning. and we have guests from all across the political spectrum to discuss ranging from congress, than hayward, herald ford. they will be onset to discuss. and from the white house, we have bill daly and bin ginsburg, former white house officials in their own right. so we'll see how they feel about the debate and what happened last night.

but one thing is clear, guys, as you have been talking about all morning, futures are positive. and we're coming off of the first lower week nor the markets. is that based on politics or other market sentiment? we have mohommad from allianz here. don't miss his comments on how to position your portfolio for the week. all that is coming up in just ten minutes. >> thank you. "squawk box" is something you don't want to miss. and you don't want to miss the financial section of "worldwide exchange." stay with us here. could do to our economy.tiot if we don't solve our debt problem 19 trillion and growing money for programs like education will shrink. in just 8 years, interest on the debt will be our third largest federal program. bad news for small businesses. the good news?

there's still time for a solution. ask the candidates for a plan to secure our future.

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percent, depending on what you're looking at. the dow is expected to open higher by 48 points. last week was the first negative week in four, so part of this is a bounce back. we are down to .70% last week. the worst performer was down 5%. banks did have a good week over 1% of gains against almost all the banks. goldman sachs up 5% as the yields ticked up. the ten-year note above 1.7% this morning albeit being closed for columbus day. a quick look at the markets. wti is down half a percent. that's in prospect of the gains we saw over the last few weeks. joining me from london, bob parker, senior advisor for credit suisse. good morning to you, bob. do you think the strength we're seeing in stocks is politically

motivated? >> my view on the equity markets going forward is actually we just trade sideways for the next month or so. and coming back to the comment on oil, i think there is a ceiling on wti, close to $55 a barrel. so i think equity markets probably for the next two to three months trade sideways. i think there is a downward bias to the market. and i'm making exactly the same comment about the oil process as well. >> in general, will there be sector nation? banks per formformed well, the of the market didn't. >> we'll look at the correlation with bond yields in the sense that if i'm right and this small uptrend in bond yields persists. i think it's perfectly possible to see ten-year u.s. treasury

yields close to 2% at the end of this year. and i do believe the fed will raise rates. so you have to see which sectors underperform and outperform in that environment of rising yields. obviously, the banks do benefit. and i think the banks will continue to outperform now. the sectors which underperform and high liquor late with bond market yields is telecom and consumer staples. i think of three staple that is will underperform the next couple of months and probably longer term. one looks at consumer staples and they are particularly expensive. >> you dismissed my question about the politics impacting the markets at the top. i wonder if you think that investors are brushing it off as well and are not trading off of what is looking like a very uncertain election outcome in a month. >> well, i think two observations. the first observation is that investors have a very high

degree of uncertainty as to what a trump presidency would look like. what will happen to fiscal policy and other policy measures under a trump presidency. i think we actually have a clearer picture under a clinton presidency. one aspect, however, which i would argue where there is actually little difference between the two candidates is actually with respect to public expenditure. and i think both candidates will actually make a big push onto infrastructure spending. and if we do get an expansion in the fiscal budget deficit, which i think is inevitable with either candidate, then i think that is supporting the fed following a path of higher interest rates throughout 2017. >> you're sitting through in london, you had the weekend to get over the flash crash in sterling that we saw thursday/friday last week. how concerned are people that this sort of hard line on brexit that the government is taking is really going to back fire?

>> well, i think there's a lot of concern. and if you talk to people in the uk government about what their strategy is, the general answer you get is they're working on it. and if you ask the question, is it going to be a hard brexit, which means essentially a departure from the european union, the departure from the free trade zone by 2019, i think markets are starting to actually focus on the probability of that happening. and that would have obviously negative implications for trade, tariff barriers would be put up. and also it would have impact on foreign capital. i think one very fundamental point to make about the uk is we have a current account deficit of around 6% of gdp. the uk needs foreign capital inflow, which it has been very successful at achieving over the last five to ten years. and if that foreign capital inflow slows down or at worse

reverses, that has negative implications for the currency and the economy. >> i think the upshot from a week of high level talks from financial heavy-hitters at the imf world bank meetings on this note of brexit is that politics are interfering with the economic outlook. and whether that is trade or backtracking on globalization, how as an economist and someone that looks at markets globally over the next year do you factor that in? >> well, i think if you look at investor behavior at the moment, and it's not just your presidential election coming up now, it's investors are very concerned about the political environment in europe, not just brexit, but the elections that we have in countries like germany, the netherlands, france in 2017. we have an italian referendum on the 4th of december that could result in a political reversal in italy with all the implications that has. so i think what we're seeing amongst investors at the moment

is very cautious. two points, number one, very cautious behavior towards investors. >> i have to jump in, we're out of time. thank you very much for joining us. that's it for "worldwide exchange." we're talking within a 1% difference in reliability of each other. and, sprint saves you 50% on most current national carrier rates. save money on your phone bill, invest it in your small business. wouldn't you love more customers? i would definitely love some new customers. sprint will help you add customers and cut your costs. switch your business to sprint and save 50% on most current verizon, at&t and t-mobile rates. don't let a 1% difference cost you twice as much. whoooo! for people with hearing loss, visit sprintrelay.com.

good morning. donald trump and hillary clinton sparred for the second time last night and it got personal. the highlights straight ahead. residents from florida and along the east coast say the danger is not over yet. we have the danger on rising floodwaters. and big problems for samsung after several replacement phones reportedly caught fire. it is monday, october 10, 2016. and "squawk box" begins right now. >> live from new york where business never sleeps, this is

"squawk box." good morning and welcome to "squawk box" here on cnbc. i'm andrew ross sorkin along with kayla tausche. becky quick is off as the baby arrived, kaylie noelle quayle is the name. that's a beautiful baby. >> just before midnight on friday. >> on friday. if you look at all the kids, they are all sort of -- there's a similarity with the names, what they start with and end, they are all tied together. >> i think it sounds like a great name, personally. >> it does. >> gorgeous baby. we are so happy for them. so happy that both becky and baby are healthy.